In the new issue of Regulation, economist Pierre Lemieux argues that the recent oil price decline is at least partly the result of increased supply from the extraction of shale oil. The increased supply allows the economy to produce more goods, which benefits some people, if not all of them. Thus, contrary to some commentary in the press, cheaper oil prices cannot harm the economy as a whole.

Two long wars, chronic deficits, the financial crisis, the costly drug war, the growth of executive power under Presidents Bush and Obama, and the revelations about NSA abuses, have given rise to a growing libertarian movement in our country – with a greater focus on individual liberty and less government power. David Boaz’s newly released The Libertarian Mind is a comprehensive guide to the history, philosophy, and growth of the libertarian movement, with incisive analyses of today’s most pressing issues and policies.

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McAuliffe-nomics

Good news for Virginia taxpayers! Turns out that gubernatorial candidate Terry McAuliffe, longtime Democratic fundraiser and former national chairman, understands the power of tax cuts. At a forum on Wednesday, he said that $1.25 million in tax cuts could generate $80 million in economic activity. I’m not sure even Art Laffer or Christina Romer would claim that much return on tax cuts. But here’s McAuliffe:

At George Mason University yesterday, McAuliffe said Virginia’s appeal to Hollywood filmmakers could improve the state’s economic picture. McAuliffe said he became familiar with the potency of the film industry while serving as chairman of the Democratic National Committee.

During a roundtable discussion with local filmmakers and producers at George Mason, he unveiled a proposal to offer additional tax incentives and other benefits to film crews making movies in Virginia. He said the state has been losing out to such states as North Carolina and Georgia, which offer greater benefits and have seen their film industries flourish.

He pointed to the HBO miniseries “John Adams,” about the nation’s second president, as an example of a film project that had benefited the state. The miniseries, filmed partly in Williamsburg and at the College of William and Mary, cost Virginia $1.25 million in tax breaks, but it boosted the local economy by $80 million and created 3,500 jobs, he said.

Unless … wait a minute. Could it be that McAuliffe only favors targeted tax cuts, tax cuts that would direct economic activity in a particular direction, tax cuts that would in fact help his Hollywood fundraising friends? Hard to say. He’s not calling for tax increases during his gubernatorial campaign, but of course he helped President Clinton raise taxes and he supports President Obama’s tax-spend-and-borrow policies. According to this liberal blogger, McAuliffe tells liberals privately that he can’t run for governor of Virginia on a tax-increase platform … if you get my drift.

But hey, if a $1.25 million tax break can generate $80 million of economic activity, what could a $125 million tax break do for Virginia?